Where to Invest Now

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Here are a few sectors to take a look at in 2007:
Telecom stocks Low valuations and high dividends make this sector a classic value play right now. Because they’re reliably profitable, telecom firms should keep churning out those yields even in a declining market.

Intermediate bonds If the bull market comes to an end this year, look for a flight to quality and for bonds to come back into fashion. But don’t get stuck too short or too long; the middle ground of intermediate term bonds is your best bet.

Financial firms Commercial banks and stock brokerages are hovering at appealingly low prices. But you’ll want to look at a bank’s sources of revenue, in particular
its exposure to subprime loans which has already caused problems for HSBC Holdings PLC (HBC). Still, 2006 was the sector’s breakout year–as evidenced by massive Wall Street bonuses–which means that it could be time to buy.

IPOs With hedge funds and private equity firms throwing their weight around, there’s a whole lot of money trickling through the economy. That usually bodes well for the IPO market and for a growth-oriented investing strategy.